Which of the Following Statements Is CORRECT

question 84

Multiple Choice

Which of the following statements is CORRECT?

• A)If a stock has a beta of to 1.0, its required rate of return will be unaffected by changes in the market risk premium.
• B)The slope of the Security Market Line is beta.
• C)Any stock with a negative beta must in theory have a negative required rate of return, provided r_RF is positive.
• D)If a stock's beta doubles, its required rate of return must also double.
• E)If a stock's returns are negatively correlated with returns on most other stocks, the stock's beta will be negative.

---

Definitions:

Cross Buying

The practice where customers purchase additional different products or services from the same company.

Staircase Analysis

A method for evaluating the progressive steps or stages in a process, such as customer conversion or product development, to identify improvements.

Brand Awareness

The extent to which consumers are familiar with the qualities or image of a particular brand of goods or services.

Market Share

The part of a market that is under the influence of a distinct company or product.